Face the Difference

8/3/2019 Face the Difference

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The Impact of Low Pay inNational Supermarket Chains

Face

Differencethe


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page 2 Face the Difference

Te Fair Pay Network is a national, broadidentity coalition dedicated to leading the

fight against the endemic levels of low-paidwork and the increasing prevalence of

in-work poverty that blight Britains social andeconomic landscape.

We believe that fair pay levels are a right, nota privilege and that no one who works shouldlive in poverty. o this end we work to shape acountry in which both the incidence and socialand economic costs to the public of low-paid

work and working poverty are sharply reduced.

www.fairpaynetwork.org

This report was produced by:

Mark Donne, Tim Bickerstaffe, Ben Sellers, Andrew Birchall,

John Stirling, David Bates, Joanne Treasure, Scarlett Redman,

Zoe Courtney, Lisa Parrott and Marcus Daborn.

Photography by Barney Bodoano

With the kind support of:

Joseph Rowntree Charitable Trust

The Webb Trust

Scurrah Wainwright Charity


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page 3Face the Difference

Te rising cost of feeding afamily, getting around and

increasing unemploymentadd up to the biggest

squeeze on families sincethe last recession

Andy ClarkeChief Executive Officer of ASDA

We are very keen ontrying to move towards

a living wage, workshould pay, thats the key

Rt Hon Iain Duncan Smith MPWork and Pensions Secretary.


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ContentsPage

Introduction 5

Executive Summary and Recommendations 10

Report and Research Methodology 12

Regional Research / London 20

Research Sample Overview / London 22

Sample of interviews / London 25

Regional Research / Yorkshire and the Humber 28

Research Sample Overview / Yorkshire and the Humber 30

Sample of interviews / Yorkshire and the Humber 33

Regional Research / Preston 36

Research Sample Overview / Preston 38

Sample of interviews / Preston 41

Regional Research / North East 44

Research Sample Overview / North East 46

Sample of interviews / North East 49

Tables of cost to employee of non-living wage payment 50


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The four largest national supermarketchains in the United Kingdom esco, Sainsburys, ASDA andMorrisons now form a commercial

and employment monolith spanning everytown and city.

Between them, the four chains employ an

estimated 893,126 people at 7,293 stores.Collectively they are the largest employerblock in the country and second across bothprivate and public sectors only to the NHS.Tey are expanding at an extraordinary rate;there will be 20% more of their supermarketsin the UK by 2014, the shopping space areaequivalent of 350 football pitches1.

Tis expansion will obviously bring majoremployment opportunities, a positivedevelopment in times of economic gloom andgrowing unemployment.

By way of illustration, despite 40% of retailemployers planning to shed staff at the end of20112, Sainsburys recruited 15,000 temporaryworkers over the Christmas 2011 season,1000 more than in Christmas 20103; it hascommitted to creating 50,000 new jobs by20204, and indeed, the smallest of the fourchains, Morrisons, has already announcedthat it will create 7,000 new jobs in 20125,music to the ears of central government and apositive opportunity for job-seekers.

So perhaps understandably, centralgovernment and the Prime Ministerpersonally are placing great faith in the bigfour supermarket chains to pick up some of

the unemployment bill being generated bysignificant job losses in the public sector andrising unemployment in the private sector.

At the first and to date only jobs creationsummit a private conference onemployment generation personally chairedby the Prime Minister in Jan 2011 ASDA,

Sainsburys, esco and Morrisons were 4 ofonly 23 employers in total present acrossevery employment sector in the UK6.Te Prime Minster has publicly praised thefour large supermarkets for creating such avast amount of new jobs; in October 2011 forexample, he lauded Sainsburys for helping tocreate jobs and growth while tackling social andenvironmental challenges.7

Despite a diffi cult economic climate,expansion on such an unprecedented scaleis obviously also very good news for the

supermarkets themselves. Available records forthe most recent trading year show Sainsburysprofits up 12.8% (pre-tax profits of 827million)8, esco up 11.3% (pre-tax profits of3.54 billion)9, ASDA were technically down10.4% largely explained by an internal, oneoff payment to its parent company Wal-Mart but still recorded pre-tax profits of 803.5million10, and Morrisons up 7.3% (pre-taxprofits of 632 million)11.

Tis colossal success is vividly reflected in theannual pay and bonus packages received bythose at the top of the four.

Sainsburys CEO Justin King receives aremuneration package estimated at around

Introduction


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3,243,00012; esco CEO Phillip Clarkereceives a maximum package of 6,900,00013;Morrisons CEO Dalton Phillips can expect toreceive a maximum package of 4,000,00014(the corporate governance watchdog PIRCattacked Morrisons for excessive executive payin 201115) provided the chain continues to

perform very well; and whilst an estimation ofremuneration for ASDA CEO Andy Clarke isnot in the public domain, it is thought to besimilarly spectacular.

But as the evidence of this study proves, thoseemployed at the bottom of the employmentstructures within the four supermarket giantsare not having such a good time.

Tis report demonstrates unequivocallythat the despite the expansion, profits andexecutive bonuses, not one of the four largest

supermarket chains pay the London LivingWage rate to its staff within the capital, andnot one of the four pay the UK Living Wagerate outside of the capital.

o be clear, neither the London Living Wage the hourly rate set by the Greater LondonAuthority to ensure an employee achievesan adequate level of warmth and shelter, ahealthy palatable diet and social integrationand avoidance of chronic stress16 nor theUK Living Wage set by the UK Living WageFoundation17 and Centre for Social PolicyResearch at Loughborough University,or indeed the living wage rates set by theJoseph Rowntree Foundation MinimumIncome Standard to ensure an employeeachieves a minimum acceptable standard oflivingare legally binding in the way that theNational Minimum Wage rate is a statutoryrequirement.

But Living Wage rates have now been acceptedby local and central government of everypolitical colour, the business community and

social justice campaigners as the realistic baserates that any ethical business must pay if itsemployees are not to fall into in-work poverty.

Te previous Prime Minister Rt Hon GordonBrown MP included a commitment topaying the Living Wage in every governmentdepartment in the Labour Party manifesto of2010; present leader of the opposition Rt HonEd Miliband has endorsed the Living Wageand has written to the CEOs of Sainsburys,ASDA, esco and Morrisons asking themto pay the rate18; Prime Minister David

Cameron has described the Living Wage asan idea whose time has come19; Work andPensions Secretary Rt Hon Ian Duncan Smithhas stated We are very keen on trying to move

towards a living wage, work should pay, thatsthe key20 and both Conservative and Labourcandidates for the London Mayoralty this year Boris Johnson and Ken Livingstone haveboth operated and fully endorse the LondonLiving Wage.

Te business community are also becomingequally emphatic. Major employers such asBarclays, KPMG, Price Waterhouse Coopersand many others pay the rate, as indeeddo major retailers including Westfield andLUSH.21 Te business rationale behindthe decision is clear. According to anindependent study of the business benefits ofimplementation of the London Living Wage:

80% of employers believe thatthe Living Wage had enhanced the

quality of the work of their staff,while absenteeism had fallen by

approximately 25%.

wo thirds of employers reported asignificant impact on recruitment

and retention within theirorganisation. 70% of employers feltthat the Living Wage had increased

consumer awareness of their

organisations commitment to be anethical employer.22

And there are also significant consumerrelated reasons for major employers to payLiving Wage rates. Not only does evidencesuggest that employees receiving the ratesprovide far better service to customers, theBritish public overwhelmingly supportsemployers that act to tackle the chronicinequality of earnings between those at thetop and bottom of large businesses.23

Put simply, it cannot be acceptable toemployer, employees, government or publicthat the gigantic employer block formed byesco, ASDA, Sainsburys and Morrisons,enjoying quite colossal profits and vastexecutive pay packages at the top, will notcommit to paying all of its employees a wagerate the keeps them out of poverty.

Tis report also demonstrates that bothempirically and as far as employees ownchoices are concerned, incentives such as

store discount cards and performance relatedbonuses are nowhere near enough and cannotcompete with a fair, ethical pay rate securewithin an employees contract.


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Te following evidence also dispels the myththat has been claimed in the past, once andfor all, that any of the big four chains areLiving Wage employers, inside or outsideLondon.

Also, in a new, extraordinary government

brokered/NMW exempting development,young people in receipt of benefits arebeing forced to work for selected employers including both Sainsburys and esco for up to 30 hours per week, for no payand with no guarantee of a job at the endof the 2 month scheme. Tose who refuseto undertake work on the scheme can berefused or face reduced benefits.24 Tisis manifestly unacceptable to any ethicalemployer or government.

Whilst it is perfectly understandable that

the government of the day would seek toencourage job generation on the scale offeredby the big four, in an economic senseit must also take into account the cost tothe treasury of subsidising low wages paidby all four. It should also consider the cost tolocal economies of low paid people having farless disposable income to plough back intolocal businesses.

Government must also consider the socialcost of parents spending less time with their

children, the cost to the NHS of adults

and children with poor diets, and a raft ofother social costs directly associated within-work poverty.

esco, ASDA, Sainsburys and Morrisonsall produce annual Corporate SocialResponsibility reports which detail the superb

work and financial donations they investin numerous community projects and localcharities. Tis is to be commendedand encouraged. But these laudable initiativespale significantly if, as a matter of companypolicy, the four businesses pay wages whichhold their lowest paid employees in workingpoverty, as the entire community suffers asa consequence.

But more than anything, this reportprovides Tesco, ASDA, Sainsburys andMorrisons with an opportunity. 29% of all

low paid employees in the UK work in retail25a figure that simply has change.

Te big four can join other major, nationalmainstream employers in paying LivingWages, an opportunity to send a signal acrossthe retail sector as a whole that they are theleaders in both a business and communitysense, and an opportunity to make a seriouscontribution to the social fabric of almostevery community across Britain. Consumer,employee and shareholder would thankthem greatly for it.

NOTES1 http://www.channel4.com/news/supermarkets-set-to-expand-20-percent-by-20142 http://www.guardian.co.uk/business/2011/nov/28/retailers-job-losses-falling-sales3 http://www.guardian.co.uk/uk/feedarticle/98286044 http://www.independent.co.uk/news/business/news/sainsburys-to-create-50000-jobs-2369407.html.5 http://www.huffi ngtonpost.co.uk/2011/12/14/morrisons-supermarkets-to_n_1148065.html?1323872586&ncid=

edlinkusaolp000000086 http://www.cabinetoffi ce.gov.uk/sites/default/files/resources/data-pm-t the jan-marc-2011_0.pdf7 http://www.independent.co.uk/news/business/news/sainsburys-to-create-50000-jobs-2369407.html.8 http://www.bbc.co.uk/news/business-133569669 http://www.bbc.co.uk/news/business-1312598710 http://www.guardian.co.uk/business/2011/oct/06/asda-profit-drop-tesco-grocers11 http://en.wikipedia.org/wiki/Morrisons12 http://www.guardian.co.uk/business/blog/2011/nov/25/sainburys-boss-pay-incentives13 http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/8548730/esco-radically-overhauls-top-executive-pay.html14 http://www.guardian.co.uk/business/2010/apr/08/morrisons-executive-pay-marc-bolland15 http://www.independent.co.uk/news/business/news/pirc-attacks-morrisons-over-executive-pay-policy-2291960.html16 http://www.london.gov.uk/sites/default/files/living-wage-2011.pdf17 http://www.crsp.ac.uk/MIS/downloads/livingwage/Te-Living-Wage-in-the-United-Kingdom-May-2011.pdf18 http://livingwage.edmiliband.org/2010/08/05/lettertobusiness/19 http://www.citizensuk.org/2011/05/citizens-uk-celebrates-10-years-of-the-living-wage-campaign/20 http://www.livingwage.org.uk/employers21 http://justice-for-cleaners.org.uk/index.php?option=com_content&view=article&id=84:living-wage-employers-in-

london&catid=36:news&Itemid=1822 http://www.livingwage.org.uk/about-living-wage23 http://www.guardian.co.uk/business/2011/jun/05/pay-gap-is-too-wide-say-two-thirds-of-britons24 http://www.guardian.co.uk/society/2011/nov/16/young-jobseekers-work-pay-unemployment25 http://www.poverty.org.uk/52/index.shtml


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Executive Summary &

Recommendationsi) Overview

Between June and December 2011, 100 engagement interviews and repeat interviewswere conducted by Fair Pay Network research teams, with 100 employees of esco,Sansinburys, ASDA and Morrisons identified from 34 stores in four UK regions:

London, Preston, Yorkshire and the Humber and the North East.

All interviews and dialogue took place in a neutral venue agreed by researchers andemployees, and were never conducted during contracted work time or within the storethe employee worked in.

Te gender ratio of employees was 46% male 54% female. Te average contractedhours per employee was 27.7 per week.

Te roles carried out by participants in the study were: Shop Floor Sales Assistant,Produce Stacker, rolley Person, Code-Checker, SDA (Shelf Display Artist), DeputyManager, Driver, Department manager, Checkout Captain, Order-Picker, Cold FridgeStock Rotators, Administrative Assistant, Warehouse person, Store Supervisor, StoreCleaner, Forklift driver/operator.

Te length of employment service range was as follows: Shortest: 8 days Longest: 29years.Average: 5.02 years

ii) Rate of Pay

86% of interviewees were not receiving either the London Living Wage, or outside of thecapital, the UK Living Wage. 56% stated that they feel they do not earn enough to live on.

54% reported a slight pay increase in last 12 months 46% did not.

Te average hourly pay rate was6.83, the lowest hourly pay rate recorded was6.14(Shop floor sales), and the highest hourly pay rate recorded was13.50 (Store manager

with 27 years service). Te four largest supermarket chains all operate pay packages involving a basic rate of pay,

a store discount card (sometimes issued immediately, most commonly within 6 monthsof employment), and a performance related annual bonus, subject to varying factors.

Only19% of employees selected this status quo as the most preferred package, whenoffered two other theoretical package options.

44% expressed a preference for a higher hourly rate of pay than presently received (withannual increase) but no annual bonus scheme; 37% expressed a preference for a higherrate of pay than presently received (with annual increase), but no store discount card.

21% of employees stated that their rate of pay is lower that I would like and causes meproblems like doing without certain foods/clothes/leisure activities/activities for my children.

22% stated that their rate of pay is so low it means I do without a lot of things and Istruggle to make ends meet, and 8.5% of employees stated that their rate of pay is so lowit means I am getting into debt, having to work more and seeing less of family and friends.


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iii) Employment Package & Contract

A lack of contracted hours at an ethical pay rate, the varying and unpredictable natureand impacting factors on performance related pay, the relatively low usage of storediscount cards and the worrying absence of training and guidance to secure skills and ahigher rate of pay all depress employment quality and standard of living.

56% of respondents do not have full time contracted hours and rely on overtime, asecond job or state benefits to survive. 18% of respondents have a second job due to lowwage from their main supermarket job.

53% of employees reported that they did not receive a performance related bonus forthe most recent trading year.

77% of employees felt their employer had not taken any action to assist them in gettingpromotion to a different or better paid role.

Only18% of employees were covered by an employer pension scheme:

44% of employees felt they had not been offered training by their employer to gaingreater skills.

Only18% of employees hold membership of a trade union.

58% had received a discount store card.

Of those who had, 31% use rarely as they found the store too expensive and so usecheaper stores; 30% of respondents also reported shopping at discount food stores orstreet markets as more economical than using a discount store card in their store ofemployment.

51% of employees take regular over-time hours, outside of the hours they arecontracted to work.

Of those that do, 42% stated the reason for taking overtime was that theydo not earnenough with basic pay and contracted hours.10 respondents reported problems with

receiving overtime pay on more than one occasion.

iv) Present financial difficulties

In direct contrast to remuneration at the top, supermarket employees on low pay aresuffering badly during the economic recession and personal debts are rising as a meansto financial survival.

64% of respondents hold personal debts (excluding mortgage payments) of between500 20,000. Te most common personal debt bracket is between 500 4,000(43% of respondents).

63% of employees have actually increased personal borrowing in the past 12 months;31% from credit cards/loans/overdraft/store cards or catalogues, 32% from family orfriends.

Quality of life is depleting and families are suffering materially and in terms of time tosocialise or relax.

In the last 12 months:

22% of employees have reduced spending on items for children e.g. clothes, toys,footwear

52% have reduced spending on food shopping

70% have reduced spending on personal items e.g. clothes, books, music, cosmetics

69% have reduced spending on going out e.g. restaurants/pubs/cinema/sport events

66% have reduced the amount spent on socialising with family/friends.


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Recommendations

1 Tat esco, ASDA, Sainsburys andMorrisons engage with large scaleLiving Wage employers such as KPMGwho may be in a position to offerguidance or even bespoke structuralmodels to instruct how becoming a

Living Wage employer can be cost neutralover the longer term.

2 At the earliest feasible opportunity, as amatter of company policy, esco, ASDA,Sainsburys and Morrisons become LivingWage employers paying the LondonLiving Wage rate at all London storesand the UK Living Wage rate outsideof London from day one of a newemployment contract, as the starting,base hourly pay rate to all directlyemployed members of staff.

3 Tose at the earliest feasible opportunityesco, ASDA, Sainsburys andMorrisons give a public commitmentto only maintain supplier contractswith external suppliers that pay eitherthe UK or London Living Wage, asis relevant.

4 Tat with immediate effect, esco,ASDA, Sainsburys and Morrisonsreview their training and skillsdevelopment programmes for those

employed on the lowest pay grades, toensure that those employees are notabandoned in stagnation roles on longterm low paid salaries.

5 As a matter of company policy, esco,ASDA, Sainsburys and Morrisons increase,where desired, the amount of hourscontracted to employees.

6 As a matter of company policy, esco,

ASDA, Sainsburys and Morrisons extendcompany pension provision as widely as isfeasible.

In lieu of these developments:

1 Te Prime Minister and Secretary of Statefor Work and Pensions call upon andencourage esco, ASDA, Sainsburys andMorrisons to become living wage employers.

2 Te Mayor of London to call upon and

encourage esco, ASDA, Sainsburys andMorrisons to pay the London Living Wagein all London stores.

3 Tat shareholders of esco, Sainsburysand Morrisons join the Fair Pensionscampaign26 to ensure the store chainsas members of the FSE 100 pay theLondon Living Wage.

4 Tat as a matter of urgency, the tradeunions operating within esco, ASDA,Sainsburys and Morrisons USDAW,

Unite the Union and GMB launchmajor national recruitment initiatives tosecure greater protection for employees.Coverage is low and must be increased.


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5 Tat esco, ASDA, Sainsburys andMorrisons introduce a pay element intotheir CSR reports with immediate effect.

6 Tat the Department for Business,Innovation and Skills urgently consider

an analytical study of the estimated gainto the national economy, particularly localbusinesses of esco, ASDA, Sainsburysand Morrisons becoming Living Wageemployers.

7 Tat local and regional Councils,Chambers of Commerce and smallbusiness associations consider urgentstudies of how much could be gained bylocal economies as a direct consequenceof major supermarkets paying the UK orLondon Living Wage as is relevant.

8 Tat esco continue to meaningfullyengage with the Citizens UK campaignto achieve the London Living Wage foresco store cleaners working in Londonbranches.27

9 Tat Sainsburys meet with Unite theUnion at the earliest possible convenienceto discuss their active campaign fora Living Wage for all Sainsburysemployees.28

NOTES26 http://www.fairpensions.org.uk/category/categories/living-wage27 http://www.citizensuk.org/2011/04/press-release-living-wage-campaign-meet-tesco-ceo-philip-clarke/28 http://www.unitetheunion.org/campaigns/sainsbury_s_-_pay_a_living_wag.aspx


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An explanatory note on reportpresentation:

Troughout the research and interviewingprocess, the confidentiality, if requestedanonymity and job security of the respondentemployees was absolutely paramount to allresearchers and mentors.

Almost all employees participated undera heightened level of fear of dismissalor disciplinary action, and whereversupermarket management did become awareof the research being undertaken, all branchemployees were prohibited in no uncertain

terms from participation.

o this end, the presentation and publicationof this report continues our duty of careto those whom we met with and providedinformation and interviews to us for thepurposes of this study.

As a consequence, a majority of our findingsare presented as aggregations or percentages,much material has been omitted completelyin case of leading to employee identification,and all quoted interview samples are given

under the identity of a letter, rather thanthe employees name. In addition, no data isdirectly sourced to a particular supermarket orbranch.

Much information that we did receive, whichwe feel would have strongly demonstratedthe case for ethical wages in the largest foursupermarket chains has been removed. Detailof personal sacrifices, very particular hardshipsor specific detail on salary discussions orreviews has all been either edited or completelyremoved for fear of employer identification.

4 research teams, comprised of 2researchers and 1 mentor were recruited foreach of the selected regions.

Outreach and procurement plansinitially involved working through

trade unions active within the 4 largesupermarket chains. In practice thisproved impossible, so all procurement andengagement was achieved exclusively of anytrade union.

Researchers operated in 2 principle ways:

1. Direct, brief face to face contactwith supermarket employees whilst atwork and the dissemination of a letterof introduction to the researcher and theproject, with a telephone number provided

for employee interest.

2. Procurement via communityopportunities such as community centresand friends of participating employees alsoemployed within the 4 large supermarketchains.

An interview questionnaire was workedthrough and completed either

a) At a neutral location in the researcherspresence with guidance offered as to the

flow and detail of the questionnaire, or

b) In the respondents own time, privatelyat home or in some other agreed thirdparty location. Te decision on whetheroption a) or b) was taken was entirely therespondents.

Sustained engagement interviews werethen suggested and promoted. Tese aimedto map the effect of conditions (ie: foodinflation) and rising domestic overheadswith low pay as a factor itself. Tese were

held at third party private locations whichthe FPN and its research teams assistedwith. Te two approaches were maintainedfor a 6 month period.

Report and Research

Methodology


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Participating employees were remuneratedfor engagements.

Every participating employee was askedto sign (and signed) a disclaimer certifyingthe following stipulations and conditions hadbeen clear and adhered:

1. Confirmation that the informationprovided was a true, accurate and basedon the employees own personal experienceof being employed within a supermarket.

2. Tat participation in the research wasentirely voluntary and a matter of his/her

own free choice.

3. Confirmation that no external source,individual or anyone connected to orindependent of the Fair Pay networkinfluenced or in any way attempted toinfluence his/her responses in anyway,and that during the interview process,no duress or encouragement of any formwas applied by the interviewer or anotherperson(s).

4. Acknowledgement and agreement that

the remuneration received by the employeewas for time spent away from private life/professional life to complete interviews aspart of this project.

5. Acknowledgement and agreement thatthe interview or information provisionprocess was objective, and there wouldbe no relationship whatever between theresponses given and the remuneration; thatthe employee would be remunerated forhis/her time, regardless of the detail andcontent of responses.

Outline of regional approach andarising, process based issues:

1. London

Initial procurement was slow in the SouthLondon area but steadier in the East Londonarea. Once established the process wasrelatively fluid, although conducted withextreme sensitivity to those participating,as a very live and palpable fear of employerrepercussion persisted.

One employee reported that the emphasis ontwo stores in East London had been noticed,

and a warning issued to any employees that ifapproached, they were to contact a supervisoror store manager immediately.

Te study was completed on time.

2. Yorkshire and the Humber

No contacts or gatekeepers existed withinany of the supermarket branches selected aspotential places to recruit respondents, sofieldwork began with a cold-calling phase.

Initially, 8 Sainsburys branches of varioussizes and locations within greater Leeds wereidentified.

One branch, a large superstore, was setwithin a council-owned car park, and it wasdecided that the researchers would park theircar there whilst trying to recruit supermarketworkers. Te researchers identified an outsidesmoking zone for staff and made contactwith several workers over about an hour.

Responding to the encouragement of severalworkers to return when other interestedstaff would be taking a smoke break, theresearchers returned several days later. Onthis occasion, a worker warned the researchers


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that branch managers had seen them from aCCV camera used to monitor staff takingtheir break.

Te researchers decided to return to theircar but when sat inside were approached bya branch manager who threatened to havethem arrested for trespass if they did notleave immediately. Te researchers confirmedthey were leaving but pointed out that theywere parked on Council land. Te managerbecame increasingly aggressive and said thata description of them would be circulatedto all Sainsburys branches in the area with arecommendation that the police be called ifthey were seem attempting to talk to staff.

Following this incident, the team werecontacted by another branch employeeagreeing to take part in the research. Te

worker confirmed that branch managementhad warned all staff not to speak to the FPNresearchers.

Partly as a result of this incident, the researchteam decided to attempt a snowballing ofrespondents from any positive contact orrecruitment. Tis proved to be the mostsuccessful recruitment strategy; however it wasalso the one that took the most time.

Te researchers had several employees contactthem by phone, following the handing

out of the letter of introduction, whoexpressed interest in the research but weretoo concerned about the possibility of theirbranch managers discovering they had takenpart to agree to be surveyed/interviewed.

One respondent (a esco worker), whoshowed initial enthusiasm to take part inthe research, decided to end her face-to-faceinterview with the researchers after about 15minutes. In the time between agreeing to beinterviewed and the actual day the researchersmet her, she had become increasingly anxious

that their participation in the research wouldbe discovered by her branch. esco workersmust sign a binding agreement not to discussany internal esco matters for any reason.

3. Preston

In the interests of preserving the anonymityand job safety of employees likely to engagewith the project, all initial contact wasattempted via regional trade unions.

Tis proved very time consuming andproblematic and thus from commencemrent,several weeks passed before any meaningfulcontact was made.

Diffi culty also arose when staff at the originalidentified workplace (A esco supplier chain Huntapac) became very concerned that ifmanaged discovered detail about the project,repercussions could be severe.

Only 2 employees were willing to participateand the research team had to assurestrict confidentiality before interviews couldtake place.

Once initial contacts were commenced,interviews varied greatly in length frombetween 25 minutes to 1.5 hours dependingon extra information presented by employees.4 employees quickly agreed to repeatinterviews, held in a neutral venue and last onaverage between 1 and 2 hours.

Broad procurement then commenced aroundsupermarket stores, which was completedwithout incident or impediment.

4. North East

Geographically, the research team decidedto focus on Newcastle, North yneside,Northumberland, Sunderland and eesside,reflecting a range of different local economiesand labour markets. Te team determined(i) not jeopardise anyones employment

in the course of our work, by potentiallycausing them disciplinary problems (ii) touse established routes wherever possible,especially via the trade unions, to gain accessto interviewees and (iii) to develop informalroutes at the same time.

Te first strategy was to contact all leads inthe trade unions, local community groups,migrant worker forums and other links. Teteam had an initial response from the tradeunion representatives they contacted whichseemed very positive. However, most said that

in order to follow protocol, they would needauthorisation from regional offi cials. At thispoint, the trail went cold, as authorisationwent from one offi cial to another without anyfirm decision being made.

Although the team persevered with contactswithin the trade unions, partly because ofthat initially positive response from localrepresentatives, they discovered that this was afamiliar pattern when contact was established.After the same experience with a numberof unions, they decided to concentrate oninformal contacts.

Tis did bear some fruit in that one of theresearchers developed a link with Wallsend


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Peoples Centre where supermarket workerswere encouraged (through the centre managerand local union organisers) to come to talkto the interviewer. Te centre even offereda room for the interviews. Similarly, localcontacts at a refugee support service, led tosome interest in the eesside area.

Ultimately, the team attempted face to faceengagement, direct approaches to supermarketemployees in the workplace, but with mixedresults. Tey only did this where it was safeto do so (i.e. not in view of managers orsecurity cameras). Te main issue here seemedto be one of credibility and trust. None ofthe respondents were familiar with the FairPay Network and it was therefore diffi cult toconvince them of the security of the processand the impact it might have.

Although the remuneration helped, itwasnt by any means the deciding factor.In a relatively short space of time, it isdiffi cult to gain the trust of the respondents,therefore the informal contacts that wehad helped enormously. In the Wallsendcase, the centre manager directly reassuredpotential participants that the researcherin question was legitimate and trustworthybecause she had known him for some years.

Te team successfully covered esco, Asda andMorrisons in a range of locations across the

North East, including ynemouth and NorthShields on the coast, Benton and Lemingtonin central Newcastle, Jarrow, eesport andStockton.

In brief, they discovered a sharp distinctionbetween those who were long-term employees,often part time and older and those who wereemployed on more casual terms. Happinesswith supermarkets as flexible employerswas much stronger with the former anddissatisfaction with terms and conditions,over-time and supervision was much strongerwith the latter.

Across the board, however, reliance onpersonal debt was an issue, with the burdenof debt becoming more diffi cult both in theyear before the project began and duringthe follow up interviews. Overly aggressivesupervision was also a theme that repeatedagain and again and this was felt to be partof a more autocratic style that supermarketmanagement had developed over a numberof years.


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Regional Profiles


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Region in focus

London


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Regional economy and labourmarket context

Tere are 3.7 million people employed inLondon, a rate of 67.8% compared to theUK level of 70.4%. Te London rate is 3percentage points lower than the pre-recessionpeak of 70.9%.29

In London, current data suggest that of 4.2million economically active people, 423,000are unemployed, an unemployment rate of9.9%. Greater London has an economicactivity rate of 66.4%.30

In London, 12% of women and 9% of menreceive low pay (less than 7 per hour).31

London remains a chronically unequalcity. Despite its extraordinary wealth, onemillion people live in low-income workinghouseholds in London and over half ofworking-age adults and children in poverty inLondon live in a household where someone isin paid work.

Tis on-going increase in in-work povertyparticularly affects families where at least one

adult works part-time.32

According to the London Poverty Profile:33

Overall, there are around 610,000 childrenand 1.28 million adults living in low-incomehouseholds in London. Whereas the total numberof children in poverty has dropped over the last

ten years, the number of adults in poverty hasactually risen.

Te number of children living in low-incomeworking families (in-work poverty) in Londonhas steadily risen since the late 1990s. Tere are

330,000 children living in in-work poverty, upby 90,000 or 40% since the late 1990s. Of thisrise, some 20,000 was in the last three years.

By contrast, the number of children living inlow-income workless families has dropped by150,000 over the same period to 280,000. As aresult, the share of in-work poverty has increased

from a third to more than half over the period.

rends for adults in low-income follow asimilar pattern. Te number of adults inlow-income working families increased by

290,000 or almost three-quarters in the ten-yearperiod (in absolute terms). In relative terms,taking account of the changing population, the

proportion of working-age adults in low-income,working households has risen from 12% to 17%.It now stands at 680,000, having risen byover 100,000 in the last three years alone.In total, one million people in London are inin-work poverty.

Te retail sector has a significant impact onLondons broader economy. An estimated 4in every 10 spent by Londoners goes into theretail sector. Retail accounts for around 10%of Londons employment making it one ofLondons employment largest sectors. 34

NOTES29 http://lseo.org.uk/content/131230 http://www.ons.gov.uk/ons/publications/re-reference-tables.html?edition=tcm%3A77-22677031 http://www.poverty.org.uk/53/index.shtml32 http://www.londonspovertyprofile.org.uk/indicators/topics/income-poverty/child-and-adult-poverty-and-work/33 http://www.londonspovertyprofile.org.uk34 http://www.london.gov.uk/mayor/economic_unit/events/retail-in-london.jsp

Regional Research / London


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Key findings

100% of interviewees are not receivingthe London Living Wage

50% of respondents do not have full timecontracted hours and rely on overtime, asecond job or state benefits to survive.

60% of respondents said they do not earnenough to live on

0% of respondents said they were happywith both their pay and terms of contract.

65% of respondents cannot afford to dotheir personal shopping in their store ofemployment and shop at other discountoutlets or markets.

35% of respondents has a second job dueto low wage from main job.

Attitudes to pay package

When offered the choice of 3theoretical pay package options,employees selected as below:

a) Te same rate of pay as I presentlyreceive plus an annual bonus scheme,plus a store discount card (essentiallythe current status quo in all 4 majorsupermarkets after either 6 or 12 months

service) 5%b) A higher rate of pay than I presentlyreceive with annual increase, but noannual bonus scheme 25%

c) A higher rate of pay than I presentlyreceive with annual increase, but nodiscount card 70%

When asked which of the followingstatements best reflected theiropinion on their current pay package,employees responded as follows:

a) I think my rate of pay is fair and ifI manage my finances carefully, I can livefairly well: 0%

Research sample overview /London

Gender:

55% male 45% female

Average contracted hours

28.7 per week.

Sites covered

Tesco: Commercial Rd (2 x branchesExpress), Canary Wharf (Express),Old Kent Road, Spitalfields.

ASDA: Isle of Dogs.

Sainsburys: Walworth Road,Bethnal Green (Local), Whitechapel.

Morrisons: Walworth Road.

Employer pension %

20%

Trade union membership %

15%

Sample of roles

Shop floor sales assistant, shelf stacker,trolley person.

Length of service range

Shortest: 3 months.Longest: 10 years.

Average: 1.2 years


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b) My rate of pay is what I wouldexpect but my personal finances doremain tight: 35%

c) My rate of pay is lower that I wouldlike and causes me problems like doingwithout certain foods/clothes/leisureactivities/activities for my children: 30%

d) My rate of pay is so low it means I dowithout a lot of things and I struggle tomake ends meet: 25%

e) My rate of pay is so low it means I amgetting into debt, having to work moreand seeing less of family and friends: 10%

f ) My rate of pay is so low that it iscausing me personal problems, bothfinancial and physical, including stress orbad health: 0%

21% reported a slight pay increase in last

12 months 79% did not.

Average hourly pay rate:6.69

Lowest hourly pay rate recorded: 6.30(Day shelf stacker)

Highest hourly pay rate recorded:8.20(Shop floor sales)

Incentives

Annual Performance bonus55% of respondents did not receive aperformance related bonus for the most recenttrading year.

Discount store-card

50% had received a discount store card

Of those who have, 30% use rarely asstore too expensive and so use cheaperstores; 15% of respondents report shoppingat discount food stores or street markets

(Watney Market, Ridley Road marketand Whitechapel Rd market were allmentioned) as more economical than usingdiscount store card in store of employment.

Training

70% felt they had not been offeredtraining by their employer to gain greaterskills

95% felt their employer had not takenaction to assist them in getting promotionto a different or better paid role

Overtime.

80% take regular over-time hours to gainextra income

1 respondent reported problems withreceiving overtime pay on more thanone occasion.

Reasons for taking overtime

a) Just for extra money: 35%

b) Do not earn enough with basic pay andcontracted hours: 55%

c) Pressurised to do so by employer: 6%

d) o help out colleagues/team: 4%

Personal debt and financialdifficulty

85% of respondents hold personaldebts (excluding mortgage payments) ofbetween 500 20,000.

15% do not have any personal debtoutside of housing costs

Most common personal debt bracketis between 500 4,000 (50% ofrespondents)

100% of respondents say their householdexpenditure has increased in the past 12

months.

continued >



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Respondents were asked to record what personal measures they have undertaken, if any, tocounter financial diffi culties in the past 12 months:

% Strategy adopted to counter financial difficulties in past 12 months

50% Reduced spending on food shopping

55% Reduced amount spent on going out e.g. restaurants/pubs/cinema/sport events

35% Reduced expenditure on sports or physical activities e.g. swimming, exercise

50% Reduced the amount spent on socialising with family/friends

50% Reduced spending on personal items e.g. clothes, books, music, cosmetics

60% Reduced spending on transport e.g. bus, car

15% Reduced/cancelled phone/internet/TV/magazine subscription

30% Reduced spending on healthcare e.g. dentist, prescriptions, opticians

40% Reduced spending on items for children e.g. clothes, toys, footwear

15% Reduced spending on childcare and/or school expenses

25% Put off repairs/maintenance to your home

40% Reduced the amount spent or cancelled a holiday

55% Increased borrowing on credit cards/loans/overdraft/store card/catalogue

8% Reduced borrowing on credit cards/loans/overdraft/store card/catalogue

35% Increased borrowing from friends and family

20% Moved house e.g. smaller home/house-share/live with friends/family

1% Rented out a room in my home

Most respondents on low contracted hours report claiming tax credits and housing benefit.

Most respondents not paying into a pension scheme as unaffordable on present rate of payor unfamiliar with option available.



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EMPLOYEE A

Age: 27

Gender: Female

Pay rate: 7.00 per hour

Contracted hours: 21

Role: Till Operator

Employee A has been employed at herstore for approaching 14 months.She has not received a performancerelated bonus but she states that it is

a possibility for the next working year, subjectto her team performance.

A says she does have a store discountcard but uses it only occasionally forbigger items as she finds it cheaper to doher main family food shop at a local ethnicmarket (Watney Market, London, E1).She says she is able to get better deals onfruit and vegetables and access credit fromone stallholder.

A and her husband (self-employed) have2 children under 3. Tey receive housingbenefit for their 2 bedroom flat.

A says it is very diffi cult to survive onher wage and that her household budgethas got much worse in the past 6 months.She says the biggest issue for her is bus faresas she must travel to and from work(involving 2 buses, so 4 in total), whicheven with an oyster card is expensive, thento and from her sisters house to collect heroldest daughter (2.5yrs), as she cannotafford independent childcare. She cannotafford the tube.

She says that for every 7 hour shift thatshe works, the first 2 hours of her after taxearnings go on travel, so she is effectivelyworking 5 instead of 7 hours.

A also records that gas and electricity billscause her and her husband huge problems,and that the last 3 times they have receivedbills, she has had to call in sick to work so herhusband can work 16 hour shifts in order totry and access money quicker.

A says that she has had to take paydayloans from a finance shop in Bethnal Green

4 times in the last 10 months in order tomake ends meet. She has worked overtimewhere available to pay these off, but it is notalways a possibility, owing to her sister notalways being in a position to take care of herchildren.

A is not a member of a trade union has notbeen approached to join one. She is unsureif she would or not. She has received basictraining relating to her role but not beenoffered any other training opportunities.

A says that if her husband has to work lesshours (licensed mini-cab driver) owing toincreased fuel costs and lack of business, shewill have to leave her job, as they simplycould not survive. She says that if she leavesher job of her own free will she will receiveless or delayed benefits, so the situation isvery, very diffi cult. She says she desperatelydoes not want to go on full benefits but thather situation cannot go on for much longeras it is.

A speaks very positively about her store

colleagues and managers. She says one of thethings she likes most about her role is herrelationship with those around her. She saysher supervisor is aware of the diffi culties facedby many of her colleagues and always tries toallocate over time where she can, and alwaysnotifies them of special offers in the store.

Sample of interviews / London


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EMPLOYEE A REPEATINTERVIEW (3 months later)

A reports that her family budget has gotslightly easier as her husband is doing moreweekend work with a friend who operatesa removal business. She says she sees herhusband much less but that financially thingsare slightly easier.

A says her store has begun recruitingtemporary employees for the Christmasperiod and that as a result overtime is lessavailable.

She says that she had asked her supervisorfor additional hours and that it seemeda possibility as A is well regarded by hermanagers, but that owing to a change in hersisters circumstances (meaning she cannotlook after As children as often), A could notfollow up the possibility.

A has again taken a payday loan to coveroutgoings but thinks she can repay it quickly(within 1 month) as her husband is doingmore work.

She says life remains very diffi cult and that herhusband now works 7 days per week.

She says that once her children are oldenough to access an amount of free childcareshe will ask for more hours from her store,but maintains that even that would not

make a great deal of difference, as her familyoutgoings increase more and more. She saysthe only thing that has made a difference toher budget and quality of life is her husbandworking 7 days per week.


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EMPLOYEE B

Age: 33

Gender: Female



Role: Shelf stacker.

Employee B has worked at her store for3 years, but with a short break whenshe travelled abroad to visit family. Bhas one child (aged 7) and lives in a 2

bedroomed ex-local authority flat which shesecured via a housing association.

B also has a second job, waitressing in a caf

owned by a family member. She says thatthis is very helpful as she can choose workinghours around her sons school times, whereasshe can less so with her store.

B records that it is pointless to ask for morehours from her store as the hours would befixed and that if she has spare time, shewould rather work at her caf job becausewith tips the hourly pay is better.

B says she has never received a performancerelated bonus, but does have a store discount

card, which she does use jointly with a foodshop at a local market (Ridley Road, London,E8) as part of her main weekly food shop.

She says she used to use the discount cardmore often, but that a manager has stoppedstaff using the discount card on foods withdamaged packaging or approaching sell bydate, which used to represent a really goodsaving, with food you could freeze. B saysstaff would alert one another to damagedpackaging or food that had been placed in the

reduced area.B says travel costs (bus), council tax andutility bills, combined with simply neverearning enough means life is very hard.

B says that her son has had to be removedfrom a planned school trip as she cannotafford it, and has been ridiculed at school forthe quality of his clothes.

She says that most weekday evenings,because of her 2 jobs and time constraints,she usually gives her son money 1 tobuy dinner from a local fast food outlet.

She says he can eat a hot meal, 3 friendchicken wings and fries, for 1 and so this iseconomically better for her as she has littlemoney and no spare time.

She says this is different at weekends as theyeat together at the caf where she works andalways cooks bigger meals on Saturday andSunday evenings.

B states that she has never been offeredtraining to access a better role within herstore. She says even if she were she wouldrefuse as the pay increases are tiny and it iseasier to work any additional hours informallywith her second job as the pay is better.

B records that her manager at the store is veryhelpful and sympathetic to the diffi cultiesshe faces. She says her manager has turneda blind eye and not deducted pay as he issupposed to do if she has ever been late.

B says that were it not for the reduced rentshe receives via a housing association she

simply could not survive. She says that evenif she worked full time at her store she wouldstill find it impossible to get by. She saysideally she would leave the store altogetherand work full time in her second job, butthat the caf owner cannot afford to pay herfull time.

B says she often feels depressed with the wayher life is, especially as her son has to gowithout many things. B states that she rarelybuys clothes for herself, although there are2 very good charity shops in the Dalston areawhere occasionally she can buy cheap dresses.

B says all of her crockery and a lot of herfurnishings have come from charity shops.


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Region in focus

Yorkshire & theHumber


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Te Yorkshire and Humber region hasthe third highest rate of income poverty inthe UK. Of those jobs currently availablein Yorkshire and Humber, about half arein low paid, low-level occupations and theregion still lags behind the UK average interms of skills and earnings. Te retailsector in Yorkshire and Humber employsalmost 237,000 people, which accountsfor nearly 10 per cent of the total retailworkforce in England.

For this project, the research area selectedwithin the Yorkshire and Humber regionwas the Leeds City Region (LCR). LCRcovers the ten districts of Barnsley, Bradford,Calderdale, Craven, Harrogate, Kirklees,Leeds, Selby, Wakefield and York, and hasover half the Yorkshire and Humbers GVAand employment.

LCR is a highly self-contained labourmarket; 95% of its residents work withinits boundaries with Leeds, Bradford and

York being the only net importers of labour.Tis large labour market with almost2 million people of working age hasenjoyed certain areas of sustained economicgrowth but also pockets of concentratedworklessness.

Of those in work in the LCR in 2007,a greater proportion were employed inwholesale and retail occupations than anyother industry (17%). Recent researchconducted by the LCR Employment andSkills Board revealed that in May 2011,

of all the occupations sought by the cityregions JSA claimants the highest number(14,910) applied for Sales and Retail Assistantpositions.

Between 1998 to 2007, over 100,000 newjobs in total were created in the City Region,

with 64 per cent of this growth occurringin Leeds and Wakefield. Only very limitedemployment growth occurred in Bradford,Barnsley, Calderdale and Craven during thissame period. Now, Leeds accounts for justunder one-third of all jobs in the City Regionfollowed by Bradford, Kirklees and Wakefield.

Figures available show that in 2008approximately 36,900 people were employedin Leeds retail sector 9 per cent of the citystotal workforce. In 2008, approximately62% of these retail workers were women and54% of retail jobs were part-time positions.During the next decade, sales occupationsin Leeds are projected to show the largestincrease of any occupational group.

Recent research undertaken for the LeedsCity Region secretariat has shown that overthe next 5 years, the LCR area will generatesubstantial job growth in low paid, short-termand part-time jobs in the retail, service, leisureand catering sectors.

Regional Research /Yorkshire & the Humber


30/56


Key findings

72% of interviewees are not receiving theUK Living Wage35


54% of respondents said they do not earn

enough to live on


45% of respondents cannot afford to dotheir personal shopping in their store ofemployment and shop at other cheaper ordiscount outlets or markets.

9% of respondents had a second job dueto low wage from main job.


When offered the choice of 3 theoreticalpay package options, employeesselected as below:

a) Te same rate of pay as I presentlyreceive plus an annual bonus scheme, plusa store discount card (essentially the presentstatus quo in all 4 major supermarkets aftereither 6 or 12 months service) 18%

b) A higher rate of pay than I presentlyreceive with annual increase, but noannual bonus scheme 45%

c) A higher rate of pay than I presentlyreceive with annual increase, but nodiscount card 37%

Research sample overview /Yorkshire & the Humber

Gender:

37% male 63% female


34.9 per week.

Sites covered

Sainsburys: Leeds (Headrow & Colton),Sainsburys distribution (Haydock)

Morrisons: Leeds.

Employer pension %

18%


19%

Sample of roles

Shop floor sales assistant, Code-Checker,

SDA (Shelf Display Artist), Deputy Manager,Driver, Department manager,Checkout Captain, shelf stacker,trolley person.


Shortest: 12 weeks.Longest: 10 years.

Average: 5.1 years

NOTES35 Tis is particularly notable as the Yorkshire &Te Humberstudy recorded a sample with a far longer average employeeservice than any other region


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When asked which of the followingstatements best reflected their opinionon their current pay package, employeesresponded as follows:

a) I think my rate of pay is fair and if Imanage my finances carefully, I can livefairly well: 0%

b) My rate of pay is what I wouldexpect but my personal finances do remaintight: 45%

c) My rate of pay is lower that I wouldlike and causes me problems like doingwithout certain foods/clothes/leisureactivities/activities for my children: 36%


e) My rate of pay is so low it means I am

getting into debt, having to work moreand seeing less of family and friends: 0%


82% reported a slight pay increase in last12 months 18% did not.


Lowest hourly pay rate recorded:6.14

(Shop floor sales)

Highest hourly pay rate recorded:11.71(Department Manager)

Incentives

Annual Performance bonus

27% of respondents did not receive aperformance related bonus for the most recenttrading year.

Discount store-card

100% had received a discount store card

Of those who have, 27% use rarely as

store too expensive and so use cheaperstores; 18% of respondents reportshopping at discount food stores as moreeconomical than using discount store cardin their store of employment.

Training

45% felt they had not been offered trainingby their employer to gain greater skills


Overtime


No respondents reported problems withreceiving overtime pay on more than oneoccasion.


a) Just for extra money: 45%

b) Do not earn enough with basic pay andcontracted hours: 19%




36% of respondents hold personal debt(excluding mortgage payments) of between500 20,000.

Most common personal debt bracket isbetween 10,000 19,999 (36% ofrespondents)

81% of respondents say their householdexpenditure has increased in the past12 months.


continued >


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Most respondents on low contracted hours report claiming either tax credits and housingbenefits or both.

Most respondents not paying into a pension scheme as unaffordable on present rate of payor unfamiliar with option available.


33/56


EMPLOYEE A

Age: 26

Gender: Male



Role: Sales Assistant

Ais 26 and has been working in theFresh Produce department as aSales Assistant in a large Morrisonsbranch for 6 years. A originally

took employment Morrisons to fit in with hisstudies at university.

However, despite having graduated with

a Degree several years ago, A has not beenable to secure graduate-level employment.Having now been a low paid worker in ajob classified as low skilled for the past6 years, A cannot offer prospective employersevidence of graduate-level work experience.He subsequently feels trapped in hissupermarket job.

A can occasionally work some overtimehours but this is paid at the same basicrate. Te former higher overtime rate was

discontinued several years ago. More recentlyovertime has become far less available atthe branch, as there are major cutbackshappening.

Staff at As level working alongside him atMorrisons are also paid the NMW rate.Indeed, throughout his time spent in the job,A and his colleagues have only ever receivedwage increases in line with rises in theNMW. A reports that this situation causesa great deal of anger and concern amongstaff at the branch particularly because as

a flagship store, As branch of Morrisonsis regularly subject to store infrastructureimprovements and also generates particularlyhigh profits for the company.

Recently, A noticed that a newspaper articlehad been pinned to the staff notice boardabout a rival supermarket awarding their staffa pay increase up to 8 per hour. Te articlewas removed by a manager before the end ofthat day and A noticed that it had generated alot of discussion among the staff.

In the past 6 months, A has only received

training in health and safety and in relationto new stock and store layout. A is verykeen to access more training possibly fora management role but feels that thisroute may be blocked to him. Staff cannotindividually apply for a management traineerole, they must be recommended by anexisting manager.

A lives with his parents and brother.His low wage creates problems for him andhe worries that he will be unable to move outof his parents house and live independently.Terefore he remains living with his parentsand is particularly aware how the upkeep ofthe family home is increasingly dependentupon the combined efforts of all members ofthe household. He is also aware that his lowwage, combined with his student debt and thegeneral rise is living costs, would now makemoving out even harder. It can be a struggle

just living at home sometimes, never mindmoving out. I dont know how I would get by.

A has a store discount card that awards him

a 10% reduction on shopping at the branch.Tis discount rises to 15% twice per year.A also receives a profit share once per yearbut this IS added to his pay packet and so issubject to tax. I got 200 last year but I got ittaxed off me all 200.

Recently, A has noticed that in the run upto Christmas, his co-workers who havechildren have been talking about findingsthings increasingly diffi cult. No overtimewill be available to staff at the branch overthe Christmas period because Morrisons

employees bank hours whereby they aregiven a day off in the weeks before Christmasbut then must make up these hours over theChristmas period.

Sample of interviews /Yorkshire & the Humber


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EMPLOYEE B

Age: 42

Gender: Male



Role: Till operator

At 42, Bs working life has beenspent in retail. Over the years,he has held several managementpositions in several supermarket

companies. More recently, B was AssistantManager at a Morrisons branch but lost theposition following an accident at work thatleft him with a broken knee.

Despite a considerable attempt to returnto his normal work duties, B continued tosuffer problems following the operation onhis knee and was told by the company thatthey could only offer him part-time hourson the checkouts if he was not able to fulfilhis management role.

However, despite now only receiving theNMW rate for a 20 hour week on thebranch checkouts, B is nonetheless expectedto perform some management duties.Tis B finds particularly unjust, as heknows that the company allows for payincreases for managers at the branch levelbut the wage of general Store Assistants istied to the NMW.

On his current wage, B and his wife havenot been able to afford to go out socialisingfor 2 years, especially with three kids.Te cinemas a massive treat, a massive treat.

B also recalls a culture of negative feedbackfor branch managers at the company particularly towards managers and staff onthe night shift because they rely on those staff tomake the store pristine.

He remembers as a manager being awarethat Morrisons have a record of oneof the best performing supermarkets forthe availability of product lines, which hesaw as being down to the efforts of thenight staff.

EMPLOYEE C

Age: Undisclosed

Gender: Female

Pay rate: Undisclosed


Role: Till operator

Asingle parent with two children, Cshousehold also includes her retiredmother. C has worked full-time forSainsburys for 5 years and feels very

lucky that she has, in the main, supportiveand understanding managers at the branch

where she works.

However, Cs oldest son is now nearly 16, andso she will lose the Child ax Credit on whichshe relies. Indeed, even with the ax Credits,C would not be able to make ends meet ifher mother did not contribute to thehousehold expenses.


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Te wage C receives from Sainsburysis not enough for her to be able to liveindependently with her 2 children withoutthe contribution her mother makes;this is despite the fact that as her childrenhave grown older, and her mother can lookafter them, C now works a mix of day and

night shifts.

As working a night shift draws a slightlyhigher hourly rate than during the day,this shift pattern brings in badly neededextra money but still has an effect on Csability to fit in her household and caringresponsibilities.

Teyre really unsociable hours ... Its justthat little bit of extra money makes a little bitof difference.

With Christmas coming up, C would verymuch welcome the opportunity to work someovertime, but this is not available for her job.Overtime is restricted to day shift workingand most usually to the check-out roles.

C does have the use of a staff discount card,which awards 10 per cent reduction on

items she buys in her branch and on severaloccasions in the year, such as Christmas, risesto 15 per cent, but she does not feel it makesa significant contribution to her householdeconomy.

o be quite honest, the only reason why we

go shopping at Sainsburys is its the nearestone. If we had, like, Asda, wed go thereprobably because the 10 per cent doesnt makethat big of an impact, you know? ... Its onlybecause its on the doorstep, and because wedont drive or anything, that we go.


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Region in focus

Preston


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In the North West, current data suggest thatof 3.4 million economically active people,301,000 are unemployed, an unemploymentrate of 8.7%. Te region has an economicactivity rate of 62.1%.

In the North West, 26% of women and 15%of men receive low (less than 7 per hour).

Most recent data suggest that Preston at thelocal authority level Preston, has by far thehighest number of employed people working

within the retail and wholesale sector inLancashire as a whole, an estimate figure of15,100.

Deprivation in Preston is higher than nationalaverage for England, with an estimated 6,965children living in poverty36, this figure isconsistent with broader estimations of theLancashire region, of around 1 child in 6living in poverty37; a total of 37,000 childrengrowing up in severe poverty (Te Save theChildren report referenced here found thatthese youngsters have no proper heating, are not

eating a proper meal on a regular basis and donot have proper school uniforms.)38

Regional Research / Preston

NOTES36 http://www.apho.org.uk/37 http://www.bbc.co.uk/lancashire/content/articles/2008/09/18/one_child_in_four.shtml38 http://www.lancashiretelegraph.co.uk/news/blackburn/8869981.1_in_6_children_in_Lancashire_living_in_poverty_/


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Key findings

90% of interviewees not receiving UKLiving Wage

Included in the 10% that are receiving theUK Living Wage, are a manager with 27years service and an employee regularlyworking in excess of 50 hours per weekwith additional night pay to achieve his

pay-rate.


70% of respondents said they do not earnenough to live on


70% of respondents cannot afford to dotheir personal shopping in their store of

employment and shop at other discountoutlets.

14% of respondents have a second jobdue to low wage from main job.


When offered the choice of 3 theoreticalpay package options, employeesselected as below:

a) Te same rate of pay as I presently

receive plus an annual bonus scheme, plusa store discount card 14%

b) A higher rate of pay than I presentlyreceive with annual increase, but noannual bonus scheme 71%

c) A higher rate of pay than I presentlyreceive with annual increase, but nodiscount card. 15%

When asked which of the followingstatements best reflected their opinionon their current pay package, employees

responded as follows:a) I think my rate of pay is fair and if Imanage my finances carefully, I can livefairly well: 4%

Research sample overview /Preston

Gender:

62% male 38% female


24.5 per week.

Sites covered

ASDA (Clayton Green and Fulwood)

Sainsburys (Preston, Bamber Bridgeand Penwortham)

Huntapac39 (Tesco Supplier Chain)

Employer pension %

14%


23%

Sample of roles

shelf stackers, order-pickers,cold fridge stock rotators,produce stackers, till operators,administrative assistant.


Shortest: 4 months.Longest: 29 years.

Average: 6.3 years

NOTES39 http://www.huntapac.co.uk/


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b) My rate of pay is what I wouldexpect but my personal finances doremain tight: 35%

c) My rate of pay is lower that Iwould like and causes me problemslike doing without certain foods/clothes/leisure activities/activities for mychildren: 4%


e) My rate of pay is so low it means I amgetting into debt, having to work moreand seeing less of family and friends: 16%


57% reported a slight pay increase in last12 months 43% did not.


Lowest hourly pay rate recorded:6.17(day shelf stacker)

Highest hourly pay rate recorded:13.50(Store Manager with 27 years service)

Incentives

Annual Performance bonus

61% of respondents did not receive aperformance related bonus for the most recenttrading year.

Discount store-card

100% had received a discount store card most dont do main shop in store ofemployment as too expensive

33% use rarely as store too expensiveand so use cheaper stores; 70% ofrespondents report shopping at discountfood stores such as Aldi or Lidl asmore economical than using discountstore card in store of employment.

Training

28% felt they had not been offeredtraining by their employer to gain greaterskills


Overtime


2 respondents reported problems withreceiving overtime pay on more than oneoccasion.


a) Just for extra money: 35%b) Do not earn enough with basic pay andcontracted hours: 50%




71% of respondents hold personal

debts (excluding mortgage payments) ofbetween 500 20,000.

30% do not have any personal debtoutside of housing costs. (NB: It is worthnoting that the 30% without any personaldebt are all within the 45-55 age bracket,whereas the 70% with personal debt all fallwithin the 20-45 age brackets)

Most common personal debt bracketis between 500 4,000 (42% ofrespondents)

70% of respondents say their householdexpenditure has increased in the past12 months.

Research sample overview / Preston

continued >


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Most respondents on low contracted hours report claiming tax credits and housing benefit.

Most respondents not paying into a pension scheme as unaffordable on present rate of pay.


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EMPLOYEE D

Age: 20

Gender: Male



Role: Till Operator

Dreceived a 14p per hour payincrease in the last financial year.D does not believe his wage is fairand struggles to make ends meet.

Most enjoyable aspect of role is relationshipwith colleagues.

D has recently joined a trade union forbetter protection. Worst thing about role ispay rate and treatment of shop floor staff bymanagers. Daily workload is manageablebut he is expected to do more if a colleague isoff sick or on annual leave. No extra cover andespecially bad at weekends when store busy.

D has received training in health and safetyand stock control and has been offered furthertraining but has rejected as team leaders arestressed all of the time.

D states:

I have to live with my Mum and her partneras I could not afford to live on my currentsalary. I have to give my Mum 50 per weekand buy all my own toiletries and food. I amsaving to go to university next year but with theincreased cost of living I am struggling to saveany significant amount.

My Mum is registered disabled and is unableto work, so I have some care responsibilitieswhich I share with her partner. Tis stops me

from taking a second job although I can doovertime if Mum has her partner at home. Iam not eligible to claim welfare benefits due toliving with my Mum.

I have a store discount card at 10%; all staffget this after a 12 week probationary period.I do not shop at the store unless it is a doublediscount day or there are special offers on, asit is too expensive. I received a pro-rata bonus

payment in March of 46, due to not beingthere a full 12 months. Tis isnt a great amountand I would rather have an hourly rate increaseand they scrap the bonus.

I have cut down on personal stuff like clothes

and PC games and I dont go out as much as Idid (twice per month) and stay in a lot or just

go round to friends houses at night if Im notworking.

Sample of interviews / Preston


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EMPLOYEE C

Age: 39

Gender: Male


Contracted hours: 30+

Role: Produce Stock Controller

Creceived a pay increase in the lastfinancial year of 14p per hour. Cstated that he felt his wage wasabysmal. Aspects he dislikes most

about his job are the pay rate and lack ofcommunication from managers to shop floor.

C feels his daily workload is manageable, just

although there are issues at weekends whenbusier. C states that the working atmosphereis sometimes dire. C has been trainedin health and safety, safe handling and hisemployers own standards training.

C lives with his partner and relies on theircombined income. If it were not for hisrelationship, C states that he would not beable to live on his current salary and would beforced to move back in with his parents. Cscontracted hours fit in with his home life andcause no problems.

C has does not buy personal items and has

recently cut back on clothes, going out (goesout once per month and a meal with hispartner roughly once every 2 months), andhis motorcycling club (fuel too expensive andstore discount does not extend to fuel). C isnot entitled to claim any benefits owing to hispartners income.

C has a store discount card set at 10% rate.He has started shopping at cheaper, non-branded food shops to save money.

C qualifies for an employer bonus scheme;

which is subject to store targets being met,overall team performance, lateness, and wastage.C states that if a staff member is off sick it isdeducted from their bonus.C did not disclosehis bonus for the last financial year.



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Sample of interviews / Preston

EMPLOYEE B

Age: Undisclosed

Gender: Male


Contracted hours:40 (regularly works 56)

Role: Driver

Bworks for a private contractor/supplier to a major supermarketchain. His role involvesdriving, HGV shunting in the

companies yards and trips to the companysfarms to collect produce that has beenfreshly picked.

B receives a standard rate of pay set at6.44 per hour and states that he doesnot receive night out money or a bonus,although a higher rate of 8.40 per hour is

offered to those who work from 5pm into the night.

B recorded that a minimum wageincrease had been paid to packers andpickers within the warehouse division(October 2011) but no wage increasedhad been discussed with drivers. Te lastincrease day can recall was in Oct 2010

when 14p per/hour had been added to thestandard rate. D records that this wasreached unilaterally by the employerwithout any negotiation with staff or therelevant trade union, and that staff werenotified verbally.

B records that he is disappointed with hissalary and states were he a younger personwith a family he would seriously struggle tomake ends meet.

D records a reoccurring issue with esco

charging his company for using theirbranded produce trays, and a finer systemimposed if an incorrect order is despatchedon a pallet. Te fine is 7 per tray andper error.


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Region in focus

North East


Te North East has for a long time beenbottom or near the bottom of a range ofindicators of poverty, including medianearnings, unemployment, welfare claimantsand economic inactivity.

A rapid erosion in the manufacturing baseand the traditional industries of the region coal mining, steel manufacturing andshipbuilding have only partially been offsetby the increase in the role of the servicesector in the regions economy. As a result,

there are many pockets of worklessnesscentred particularly in former industrialareas such as the Northumberland andDurham coalfields, both banks of the yne,Sunderland and eesside.

According to the 2010 Labour Force Survey,119,812 people (10% of the overall workingpopulation) in the North East were employedin retail, working in around 10,355 retailestablishments. Of that workforce, 64%are female and 52% work part-time. TeNorth East accounts for 5% of the total retailworkforce in the UK.

Research carried out by CACI RetailFootprint show that the major retail centresin the North East are located along thecoast and main estuaries of yne and Wearand eesside. In areas worst hit by bothlonger term de-industrialisation and recentrecession in the North East, retail (andsupermarkets specifically) is now often themajor local employer.

Te economic news has been unremittingly

grim for the North East during 2010-11.Te big headlines have been made by theunemployment figures. Te September2011 release of the Regional Labour Market


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Statistical Bulletin from the Offi ce of NationalStatistics (ONS)40 showed an unemploymentrise of 18,000 for the last quarter alone, anincrease of 1.3%.

Te North East has the highest rate ofunemployment in the country at 10.7%.Tat figure represents the highest regionalunemployment rate of any region since 1997.Within that regional figure, there are particular

black spots, such as Middlesbrough, shown tohave the highest unemployment rate of anylocal authority in the country at 14.3%.

Te North East also has the lowestemployment rate in the UK - 65.9% - withthe numbers of those in employment fallingsignificantly during 2010-11 (the fall of2.1% was the largest in the UK). What hasalso been significant is the rise in youthunemployment. Almost 30,000 young peopleare out of work in the North East accordingto latest figures again with spikes in places

like Gateshead (26%) and Sunderland (24%)and those not in employment, education or atraining scheme (NEES) has risen by 14%over the last year.

Te long term unemployment problem hasundoubtedly been exacerbated by the recentcuts in public services. Te North East hasnearly 300,000 people employed in the publicsector, which equates to just over 25% of theworking population. As such, the region hasbeen disproportionally hit by the cuts in thecivil service and local government. With an

estimated 65% of public sector workers beingwomen, they in turn have been particularlyaffected by the redundancies, pay freezes andcasualisation involved.

However, the story in the North East is notjust about unemployment. In 2010, IPPR

produced a report In-work Poverty and theRecession41. It showed that 13% of workinghouseholds in the North East were offi ciallyin poverty, second only to the West Midlands.After housing costs are taken into account,the North East has the third highest levels ofin-work poverty, after London and the WestMidlands.

A culture of low pay, insecure work and thefear of unemployment has made a large partof the working population in the regionas vulnerable to poverty as those without

jobs. Te report speculates that whileunemployment had not, at least at thatpoint, spiralled in the same way as previousrecessions, pay freezes, reduced hours and thewithdrawal of overtime payments has had theeffect of increasing in-work poverty.

Regional Research / North East

NOTES40 http://www.ons.gov.uk/ons/dcp171778_232702.pdf41 http://www.ippr.org/publications/55/1796/in-work-poverty-in-the-recession


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Key findings

82% of respondents are not receiving theUK Living Wage


40% of respondents said they do not earn

enough to live on


51% of respondents cannot afford to dotheir personal shopping in their store ofemployment and shop at other d

Documents

Face the Difference